BTL? No Residential

Posted on 27 February 2011 by J. Long


In 2009 I was badly advised by a broker to get a buy to let mortgage even though he knew it was for residential purposes. I later found out that I should not be living in the property. I have now told my lender that I am living in the property and they want me to change to a residential mortgage. I have a good credit rating but only earn £17,500 and need to borrow £115,000. I therefore, earn too little to remortgage. In the current climate it would be ludicrous to sell so what am I supposed to do? I am completely up to date with all of the repayments.

Janice,

I can only think that your broker knew that you could not afford a residential mortgage and that the only way you could secure the property was by dishonestly applying for a BTL mortgage. This is mortgage fraud and you are lucky that your Lender is taking such a soft stance.

Unless your current Lender also offers residential mortgages and is willing to transfer you then there are only a few options left. You could sell part of the property to a partner or friend and get a joint mortgage, do you have any relatives that could stand as guarantors for a mortgage in your sole name or you can sell.

I suggest that you speak to your current Lender about transferring to a residential mortgage, staying on your current mortgage and also ask them what they will do if you just continue to make the monthly payments as and when they fall due.

Your mortgage broker is regulated by Financial Services Authority and you instigate an official complaint by first writing to your broker about the advice you received.

Peter

Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

Stay connected....

Association of Mortgage Intermediaries

Legal

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.

John Charcol is a trading name of John Charcol Limited and its Appointed Representatives. John Charcol Limited is authorised and regulated by the Financial Conduct Authority. The Financial Services Register number is 665649. Registered in England No. 9157892. Registered office address for John Charcol Limited is 5th Floor, Cutlers Exchange, 123 Houndsditch, London, EC3A 7BU. The FCA does not regulate some investment mortgage contracts. Calls may be recorded for training and monitoring.